Foxtel, Austar need to wait a little longer

Foxtel and its shareholders will have to wait at least another six weeks for the Australian Competition and Consumer Commission to decide the fate of their $1.9 billion takeover of regional pay television company
Austar United Communications
.

On Friday the ACCC said it would announce the findings of its review of the deal, which Foxtel and Austar revealed in late May, around November 30. The pay TV companies had been expecting the regulator to deliver its verdict by mid-November at the latest.

The November 30 date means Foxtel – which is 50 per cent owned by
Telstra
and 25 per cent each by Rupert Murdoch’s
News Corp
and James Packer’s Consolidated Media Holdings – would struggle to meet its late December deadline to complete the deal.

If the ACCC does not block the merger, Foxtel and Austar still have to secure approval from the Foreign Investment Review Board, Austar shareholders and the courts.

American media giant Liberty Global, which owns 54.2 per cent of Austar, is supporting the takeover.

A statement of issues released by the ACCC on July 22 said its preliminary view was that a merger of Foxtel and Austar would lead to a “substantial lessening" of competition in the pay TV, TV content and telecommunications sectors.

ACCC chairman
Rod Sims
said last week a decision about the merger had been delayed by the massive amount of information Foxtel and Austar had lodged in response to the statement of issues.

Austar shares have steadily declined since Foxtel announced its highly conditional $1.52 a share offer on May 26. On Friday they were steady at $1.195.